A fresh report from the Financial Times (FT) has revealed that hedge funds have made at least $2.3bn (£1.7bn) by shorting the stocks of publicly listed online gambling companies in 2026.
The news comes just over a month after the claims made by Muddy Waters and Callisto that Sportradar, a technology company working within the gambling industry, worked with illegal gambling operators. The two claimants had been reported to be openly shorting Sportradar’s stock.
The plan worked successfully, as the Nasdaq-listed business saw its shares drop by over 20% on the day of the allegations back on 23 April – however, Sportradar has since hit back at the claims, responding that it will “unequivocally challenge” any suggestion that it is working with the unlicensed market.
Short selling: is it paying off?
But it seems short selling has been a common – and, arguably, successful – practice within the industry so far this year.
Well-known listed businesses such as Flutter Entertainment, DraftKings and Entain are all down heavily so far in 2026, down 55%, 30% and 30% respectively.
The FT report suggests that traders positioned to make money from falls in the shares of these companies have made respective profits of $2bn, $351m and $35m already this year.
The declines in share prices of gambling and gambling-related PLCs in 2026 are not limited to the three just mentioned, though.
Stockholm-listed Betsson, whose share price is up by nearly 1,200% since its initial listing nearly 20 years ago, has seen a third of its value shaved off this year alone, while compatriot Raketech has dropped nearly 10%.
Paris-listed FDJ United, which now owns Unibet and 32Red, is down by just over 1%, though it dropped by around 9% around the time it released its Q1 2026 results.
Although the likes of Playtech, Evolution AB and Rank Group are bucking the trend of plummeting shares, gambling PLCs have been struck by the emergence of prediction markets and higher taxation across Europe, notably in the UK, over the past 12 months.
Even LSE-listed evoke, which is up by a huge 56% in 2026, is still down by 39% over the past 12 months and has a share price of around 34.5p – some way off a pending 50p-per-share offer for its entire business from Bally’s Intralot.
Not all doom and gloom for gambling PLCs
However, analysts revealed signs of optimism to SBC News in recent months regarding certain gambling stocks.
Sports data and technology provider Genius Sports is down 50% year-to-date following its $1.2bn acquisition of digital sports and gaming media network Legend.
At the time, the deal attracted some apprehension from investors over perceived confusion about how Legend would align with Genius Sports’ overall strategy, but analysts from Needham and Macquarie were confident that the stock could recover back in April.
Since then, Genius Sports’ share price has bounced back from $4.38 to $5.35 – a jump of over 20%.
Macquarie investors are also confident that Flutter Entertainment – the world’s biggest online gambling PLC which owns brands including FanDuel, Paddy Power and Sky Betting and Gaming – can offset tax rises in the UK and the looming threat of prediction markets in the US.
The investment firm still holds a target price of $190 for the business – nearly double its current share price of $97 – as it feels the underlying numbers are still in Flutter’s favour.
For now though, at least, it seems the short sellers are still coming out on top overall.
With many headwinds still impacting industry businesses across the globe, that may well be the case in the future too, but there are a few still holding out hope for the shares of gambling PLCs.
